A survey done recently by “Select,” a subsidiary of CNBC, found that “nearly half of 18-to-34-year-olds feel like they are drowning in debt.” In this age group, debt is usually from student loans, car loans, credit cards, and mortgages. 

Debt can be a very difficult and emotional topic for people to address. In the U.S., we are a consumer/debtor society. Many people take on debt to make big purchases. It seems like the “normal” thing to do. In other countries, the norm is to save for items instead of borrowing money to purchase them. So, it is pretty common for Americans to realize that our debt feels out of control suddenly.

Decreasing debt requires a change in our habits, which is not easy. We have to change the way we perceive debt. We have to budget and spend differently, and then we need to have the willpower to take any extra money we have and apply it to paying down debt instead of making another purchase.  

Two key steps to decreasing debt include:

  1. Do something, even if it’s small. Make a list of your debts. List them either largest to smallest or the highest to the lowest interest rate charged. 
  2. Pick one debt and pay it off. Depending on what feels best to you, maybe tackle the smallest one so that you can get a quicker victory by paying it off. Or, start with the one charging the highest interest rate, usually a credit card, so that the interest charged on your debt starts to go down next month. 

The following are a few additional things to consider when taking on debt. 

Review your monthly budget, expenses vs. income. Review your credit card statements. Figure out where you can cut out some costs: lunches out, daily coffee out, etc. These small purchases add up quickly. Make your food/coffee at home. Take that savings and apply it toward debt. Find other areas where you can cut back on expenses. Think about adding some part-time work on top of your normal job. While that’s not easy, if the debt has become a real burden, it could be worth the effort, even if it’s just for a short time.  

Here are seven ways to add additional income.

If you have debt that makes you feel uneasy, you should find a way to address it. You will feel better if you can decrease it consistently each month, even if only by a small amount. Just knowing that debt is decreasing and going in the right direction will help you feel a greater sense of control over your financial destiny.